Build Home Insurance Perks into Your Pitch

Whether you’re a builder or an architect, you’re always looking for new ways to sell your homes to your clients. Here’s something unique to build into your pitch – the homeowners insurance benefits. Savings and extra perks go along with insuring a new house versus an old one. You can get a leg up on the competition by using a lesser known perk to your advantage.

To start off: simply buying new can help your clients save. Homes built within the last 10 years could qualify for a discount of up to 20%. Given that the average U.S. homeowners insurance premium exceeded $822 as of the end of December, the new discount could generate savings of up to $164 a year. Providers prefer new homes because they believe there is a lower risk of them incurring an expensive claim.

Other ways that new homes can earn your clients home insurance savings and help with your sales message include the following:

New plumbing

Plumbing system failures are the leading source of home water losses, according to the Insurance Institute for Building and Home Safety (IBHS). It’s no wonder that home insurance providers wish to avoid plumbing malfunctions when the average claim per incident weighs in at more than $7,000, according to the Insurance Information Institute (III).

Updated plumbing systems in new homes form a major part of a moisture management strategy and can therefore earn your clients preferred home insurance policies, which generally come with lower premiums.

A modern HVAC system

Heating and cooling systems can be testy. In fact, heating equipment is the second leading cause of home fires, according to the National Fire Protection Association (NFPA). To avoid the approximate $5.8 billion dollars in damage that heating systems cause in fire damage every year, insurance carriers consider new HVAC systems a major factor in determining whether a homeowner qualifies for a preferred policy. New HVAC systems also typically work more efficiently and can save your clients 20% or more in utilities costs.

More fire safety

From 2007 to 2011, the U.S. experienced nearly 50,000 fires due to electrical malfunction and $1.5 billion in direct property damage, according to the NFPA. The average fire claim costs insurers in excess of $33,000, according to the III. Again, new wiring is a factor in qualifying for a preferred policy. Other anti-fire measures in new homes include smoke detectors, which can win owners premium discounts of up to 5% ($41 on that average premium cited above).

Roof stability

Roof damage from wind and hail costs an average of $7,177 per claim, so home insurance providers favor sturdy roofs. If your building project involves roofs that the carrier qualifies as impact-resistant,—UL class 3 or higher—your clients could get preferred status and qualify for lower premiums. Some materials that qualify are metal and concrete tile.

None of these savings are one-time price breaks: They can extend for years, which should increase their appeal to buyers. In fact, homeowners who go 10 years without filing a claim can win a discount of up to 20% on their premiums. New homes make it much easier to reach that 10-year threshold.

When speaking with potential buyers about the benefits of buying new, add home insurance discounts to your toolbox. You can get your clients focused on protecting their homes, while adding the benefits of lower monthly premiums. Doing so can help persuade clients to buy new – and to buy with you.

Guest Blogger Carrie Van Brunt-Wiley has been Community Manager forHomeownersInsurance.comsince 2007. She is a native New Yorker with a background in journalism and professional writing.

This guest blog post does not necessarily reflect the opinions of CertainTeed Corporation.

4 Comments

These are all good techniques on increasing the value of your home as well as increasing its chances to get sold. Safety is really the first priority for anyone buying a home as well as security and stability.

A great question Michael- and really good point. Currently there is not a specific insurance discount for homes where fire migration is reduced. However, well-sealed homes can also prevent against damage from other perils such as water and hail damage. Many insurance carriers do inadvertently reward homeowners with well-sealed homes though new home discounts (new homes are typically more air tight than older homes) and provide energy star policies that provide higher coverage limits for energy star rated windows, appliances and features. In addition, discounts and lower premiums are often available for fire safe buildings that utilize smoke detectors, fire detectors and sprinklers.

If the Department of Energy lists that properly air-sealed homes can have a 35-40% energy savings can these high numbers equate to a reduction in fire migration within a home? It seems to me that by reducing oxygen leak-points on these levels it would have a positive impact (on some level) on reducing fire spreading during a home fire. Seconds can mean life or death or at the very least less property damage. Are Insurance companies factoring this metric?